/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/230104.mbx T R O U B L E D C O M P A N Y R E P O R T E R A S I A P A C I F I C Wednesday, January 4, 2023, Vol. 26, No. 4 Headlines A U S T R A L I A MOYNE HOTELS: Jirsch Sutherland Appointed as Liquidators NORTHSHORE CONCRETING: Creditors' Proofs of Debt Due on Jan. 24 SMILESALLIANCE PTY: Commences Wind-Up Proceedings C H I N A CHINA EVERGRANDE: Lenders Fail to Sell HK Headquarter by Tender CHINA EVERGRANDE: Vows Debt Payment After Restructuring Delay H O N G K O N G GOME RETAIL: To Repay Debt in Shares I N D I A AVARTANAH INFRA: CARE Lowers Rating on INR9.75cr Loan to D BHARAT EXPORT: ICRA Keeps D Debt Rating in Not Cooperating BHARAT IMMUNOLOGICALS: ICRA Moves B+ Rating to Not Cooperating COASTAL CONSOLIDATED: ICRA Reaffirms C Rating on INR6.5cr Loan GSJ ENVO: ICRA Keeps B+ Debt Ratings in Not Cooperating Category HANUMAN RICE: ICRA Keeps B Debt Rating in Not Cooperating HINDUSTAN CONSTRUCTION: CARE Ups INR3,697.38cr Loan Rating to B+ JEEVISHA FOODS: ICRA Keeps B+ Debt Ratings in Not Cooperating KAI INTERNATIONAL: ICRA Keeps B+ Debt Ratings in Not Cooperating LAKHOTIA TRANSPORT: ICRA Keeps B+ Debt Ratings in Not Cooperating MODERN AGRO: ICRA Keeps B+ Debt Rating in Not Cooperating PAVANSUT PAPER: ICRA Keeps B+ Debt Ratings in Not Cooperating PURANDAR MILK: ICRA Keeps D Debt Ratings in Not Cooperating RAM INDUSTRIES: ICRA Reaffirms B+ Rating on INR7.40cr Loan RAPID METRORAIL GURGAON: ICRA Keeps D Rating in Not Cooperating RAPID METRORAIL: ICRA Keeps D Debt Rating in Not Cooperating ROBO EQUIPMENTS: ICRA Keeps B+ Debt Ratings in Not Cooperating SALEM DISTRICT: ICRA Lowers Rating on INR60cr LT Loan to B+ SANJIB DEKA: CARE Moves B+ Debt Rating to Not Cooperating SHAMLI STEELS: ICRA Keeps B+ Debt Ratings in Not Cooperating SHASHWAT CLEANTECH: CARE Lowers Rating on INR15cr Loan to B+/A4 SICAL LOGISTICS: ICRA Keeps D Debt Ratings in Not Cooperating SRINIVASA ENTERPRISES: ICRA Cuts Rating on INR6.25cr Loan to B+ TARA CHAND: ICRA Keeps D Debt Rating in Not Cooperating Category TREE HOUSE: CARE Keeps D Debt Rating in Not Cooperating VAMA INFRA: ICRA Keeps B+ Debt Rating in Not Cooperating Category VEER INDUSTRIES: CARE Reaffirms B+ Rating on INR6.0cr LT Loan ZEE ENTERTAINMENT: IPRS Files Insolvency Petition Against Firm I N D O N E S I A INDONESIA: 2022 Unaudited Budget Deficit at 2.38% of GDP JAPFA COMFEED: S&P Lowers LongTerm ICR to 'B+', Outlook Stable S I N G A P O R E ABHA INVESTMENTS: Creditors' Proofs of Debt Due on Feb. 3 CHOSEN INVESTMENT: Creditors' Proofs of Debt Due on Feb. 3 S O U T H K O R E A ASIANA AIRLINES: Korean Air to Complete Acquisition This Year - - - - - ================= A U S T R A L I A ================= MOYNE HOTELS: Jirsch Sutherland Appointed as Liquidators -------------------------------------------------------- Glenn Anthony Crisp of Jirsch Sutherland on Dec. 31, 2022, was appointed as liquidator of Moyne Hotels Pty Ltd, trading as The Victoria Hotel Port Fairy. NORTHSHORE CONCRETING: Creditors' Proofs of Debt Due on Jan. 24 --------------------------------------------------------------- Creditors of Northshore Concreting Pty Limited are required to file their proofs of debt by Jan. 24, 2023, to be included in the company's dividend distribution. The company's Deed Administrator is: Ahmad Zeidan A2Z Insolvency Solutions Level 5, 154 Elizabeth Street Sydney, NSW 2000 SMILESALLIANCE PTY: Commences Wind-Up Proceedings ------------------------------------------------- Members of Smilesalliance Pty Ltd, trading as 'SmilesAlliance', on Dec. 30, 2022, passed a resolution to voluntarily wind up the company's operations. The company's liquidator is: Thyge Trafford Jones Mackay Goodwin Level 10, 120 Edward Street Brisbane, QLD 4000 ========= C H I N A ========= CHINA EVERGRANDE: Lenders Fail to Sell HK Headquarter by Tender --------------------------------------------------------------- Reuters reports that the tender sale of embattled China Evergrande Group's Hong Kong headquarters has lapsed again, two sources with knowledge said, because the offer prices and terms did not meet requirements. Lenders to the office tower, China Evergrande Centre, valued at between HK$8 billion and HK$9 billion (US$1.02 billion to US$1.15 billion), appointed receiver in September to seize the asset, and put it on tender sale with a deadline for bid submission on Oct. 31, Reuters says. Reuters relates that Evergrande, which is saddled with more than $300 billion in liabilities and is at the centre of an unprecedented property sector crisis in China, had been trying to sell its 27-storey tower in Hong Kong's Wan Chai district to raise cash before it was seized by creditors. About China Evergrande China Evergrande Group is an integrated residential property developer. The Company, through its subsidiaries, operates in property development, investment, management, finance, internet, health, culture, and tourism markets. Evergrande had CNY1.97 trillion (US$311 billion) of liabilities at the end of June 2021. Once China's biggest developer by sales, Evergrande fell into distress as cash dried up and the group overstretched itself on borrowings and ventures into car manufacturing. Evergrande hired outside financial advisers Houlihan Lokey and Admiralty Harbour Capital in September 2021 to engage with creditors soon after it ran into a liquidity squeeze. It has since worked with more advisers in the past two months by turning to China International Capital Corp, BOCI Asia and Zhong Lun Law Firm on its debt workout plan. As reported in the Troubled Company Reporter-Asia Pacific in October 2022, Moody's Investors Service has withdrawn China Evergrande Group's (Evergrande) corporate family rating and senior unsecured ratings, the CFRs of Hengda Real Estate Group Company Limited and Tianji Holding Limited, and Scenery Journey Limited's backed senior unsecured ratings. CHINA EVERGRANDE: Vows Debt Payment After Restructuring Delay ------------------------------------------------------------- Bloomberg News reports that China Evergrande Group chairman Hui Ka Yan has vowed to ensure project delivery and debt payment, as the billionaire's credit crisis drags into the new year. It is a crucial year for Evergrande to deliver residential projects it pre-sold, Mr. Hui said in a Jan. 1 letter to employees, adding that construction has resumed for all its 732 real estate sites in 2022, Bloomberg relays. "As long as Evergrande employees can keep construction going, resume sales and restart operations, we will repay all kinds of debt and resolve risks in the end," according to the letter that did not elaborate detailed plans. "Evergrande will start a new chapter after that." Bloomberg says the developer is facing multiple headwinds in 2022, as China's economy weakens and housing demand slumps. It could be forced to surrender more undeveloped land parcels to local governments to help finance construction of its unfinished homes, wrote Bloomberg Intelligence senior research analyst Kristy Hung in a report. The world's most indebted developer with US$300 billion in liabilities failed to come up with a "preliminary restructuring plan" it had promised by the end of July. It missed another self-imposed year-end deadline, the report notes. The company met with an ad hoc group of its dollar bond holders in early December to formally discuss plans, Bloomberg reported earlier. It expected to receive support from offshore creditors by the end of February or early March, said the company's legal representative during a winding-up hearing in late November, Bloomberg recalls. Evergrande was urged by the judge of the winding-up case to present "something more concrete" during the next hearing on March 20. Evergrande delivered 301,000 residential units in 2022, according to the letter cited by Bloomberg. Its electric vehicle start-up has begun mass production and delivery of Hengchi 5, it added. About China Evergrande China Evergrande Group is an integrated residential property developer. The Company, through its subsidiaries, operates in property development, investment, management, finance, internet, health, culture, and tourism markets. Evergrande had CNY1.97 trillion (US$311 billion) of liabilities at the end of June 2021. Once China's biggest developer by sales, Evergrande fell into distress as cash dried up and the group overstretched itself on borrowings and ventures into car manufacturing. Evergrande hired outside financial advisers Houlihan Lokey and Admiralty Harbour Capital in September 2021 to engage with creditors soon after it ran into a liquidity squeeze. It has since worked with more advisers in the past two months by turning to China International Capital Corp, BOCI Asia and Zhong Lun Law Firm on its debt workout plan. As reported in the Troubled Company Reporter-Asia Pacific in October 2022, Moody's Investors Service has withdrawn China Evergrande Group's (Evergrande) corporate family rating and senior unsecured ratings, the CFRs of Hengda Real Estate Group Company Limited and Tianji Holding Limited, and Scenery Journey Limited's backed senior unsecured ratings. ================= H O N G K O N G ================= GOME RETAIL: To Repay Debt in Shares ------------------------------------ The Standard reports that Gome Retail is to issue 4.06 billion new shares to its creditor to repay a HK$415.63 million debt. According to the report, the Chinese electronics retailer said in a filing on Jan. 2 that the creditor, Trans Asia Inter Capital, has agreed to subscribe to the shares at HK$0.1023 each, a 7 percent discount to the closing price on December 30. The shares represent about 10.21 percent of the total shares issued by the company, The Standard says. Upon completion, the creditor will become a substantial shareholder and connected person of the firm. The Standard says the stake of founder Wong Kwong-yu and parties acting in concert with him in Gome will drop to 19.33 percent from 21.53 percent, and other public shareholders will hold 70.46 percent. Gome owed the creditor HK$415.63 million for outstanding advertising fees, the filing said. Given its liquidity issue, the electronics retailer believes the debt capitalization will enable it to settle the outstanding debt and save its cash resources for other uses, the report relays. No cash proceeds will be generated through the issue. Suppliers of a unit of Gome have filed bankruptcy petitions against it due to outstanding payments, and Gome said it will fight against them, said a filing last month, The Standard notes. About GOME Retail GOME Retail Holdings Limited (HK:0493) -- https://www.gome.com.hk/ -- together with its subsidiaries, engages in the retail of electrical appliances, consumer electronic products, and general merchandise in the People's Republic of China. The company also sells its products online through self-operated and platform models. In addition, it is involved in the provision of logistics and procurement, storage and delivery, IT development, and business management services; retailing of mobile phones and accessories; and property holding activities. As of December 31, 2021, it operated 4,195 stores in 1,439 cities. The company was formerly known as GOME Electrical Appliances Holding Limited and changed its name to GOME Retail Holdings Limited in 2017. GOME Retail Holdings Limited was founded in 1987 and is headquartered in Central, Hong Kong. ========= I N D I A ========= AVARTANAH INFRA: CARE Lowers Rating on INR9.75cr Loan to D ---------------------------------------------------------- CARE Ratings has revised the ratings on certain bank facilities of Avartanah Infrastructure Private Limited (AIPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term/ 9.75 CARE D/CARE D; ISSUER NOT Short Term COOPERATING; Rating continues Bank Facilities to remain under ISSUER NOT COOPERATING category and Revised from CARE B-/CARE A4 Short Term Bank 4.00 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category and Revised from CARE A4 Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated October 26, 2021, placed the rating(s) of AIPL under the 'issuer non-cooperating' category as AIPL had failed to provide information for monitoring of the rating and had not paid the surveillance fees for the rating exercise as agreed to in its Rating Agreement. AIPL continues to be noncooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated September 11, 2022, September 21, 2022, October 1, 2022 and December 28, 2022. In line with the extant SEBI guidelines, CARE Ratings Ltd. has reviewed the rating on the basis of the best available information which however, in CARE Ratings Ltd.'s opinion is not sufficient to arrive at a fair rating. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above rating(s). The ratings assigned to the bank facilities of AIPL have been revised on account of delays in debt servicing recognized from publicly available information i.e. FY21 and FY22 audit reports available from ROC filings. AIPL was incorporated in September 2008 under the name of Avartanah IT Solutions Private Limited. The company got its current name in June 2010. It is currently being promoted by Mr. Nilanjan Sen and Mr. Mahavir Singh. AIPL is engaged in providing Engineering Procurement and Construction (EPC) services and IT solution services mainly for the power sector. BHARAT EXPORT: ICRA Keeps D Debt Rating in Not Cooperating ---------------------------------------------------------- ICRA has retained the Long-Term rating of Bharat Export Overseas in the 'Issuer Not Cooperating' category. The rating is denoted as "[ICRA]D; ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term– 13.00 [ICRA]D; ISSUER NOT COOPERATING; Fund based Rating Continues to remain under Cash Credit 'Issuer Not Cooperating' Category ICRA has been trying to seek information from the entity so as to monitor its performance. Further, ICRA has been sending repeated reminders to the entity for payment of surveillance fee that became due. Despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. The rating action has been taken in accordance with ICRA's policy in respect of non-cooperation by a rated entity available at www.icra.in. Incorporated in 1985, Bharat Export Overseas is a partnership firm promoted by Mr. Gurprit Sawhney and Ms. Preeti Singh. The firm is engaged in manufacturing and export of garments for women. BEO has three manufacturing facilities located in Gurgaon, Haryana with total annual manufacturing capacity of 6 lakh pieces. The firm primarily exports to U.K and Germany. BHARAT IMMUNOLOGICALS: ICRA Moves B+ Rating to Not Cooperating -------------------------------------------------------------- ICRA has moved the ratings for the bank facilities of Bharat Immunologicals & Biologicals Corporation Limited (BIBCOL) to the 'Issuer Not Cooperating' category. The rating is denoted as "[ICRA]B+(Stable)/[ICRA]A4; ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term- 75.00 [ICRA]B+ (Stable) ISSUER NOT Fund Based- COOPERATING; Rating moved to Cash Credit the 'Issuer Not Cooperating' category Short Term- 50.00 [ICRA]A4 ISSUER NOT Non Fund Based COOPERATING; Rating moved to the 'Issuer Not Cooperating' category Rationale The rating is moved to the 'Issuer Not Cooperating' category because of lack of adequate information regarding BIBCOL performance and hence the uncertainty around its credit risk. ICRA assesses whether the information available about the entity is commensurate with its rating and reviews the same as per its "Policy in respect of non-cooperation by a rated entity" available at www.icra.in. The lenders, investors and other market participants are thus advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity, despite the downgrade. As part of its process and in accordance with its rating agreement with Bharat Immunologicals & Biologicals Corporation Limited (BIBCOL), ICRA has been trying to seek information from the entity so as to monitor its performance. Despite repeated requests by ICRA, the entity's management has remained non-cooperative. In the absence of requisite information and in line with the aforesaid policy of ICRA, a rating view has been taken on the entity based on the best available information. Bharat Immunologicals & Biologicals Corporation Limited (BIBCOL) is a central public-sector unit under the Department of Biotechnology (DBT), Ministry of Science and Technology. The company was established in 1989 to supply high-quality polio vaccines under the National Immunisation Programme of the GoI. It started commercial production from 1996. The facility was upgraded in 2006 to meet the WHO-GMP and revised schedule-M of Drugs and Cosmetics Act. In 2016, BIBCOL switched over to bivalent oral polio vaccine (bOPV) from trivalent oral polio vaccine (tOPV) and secured WHO-GMP certification for bOPV. In addition to bOPV in the vaccine segment, BIBCOL has been manufacturing and marketing dispersible zinc tablets and diarrhoea treatment kits in the pharmaceutical segment. It has now entered into ready-to-use therapeutic food (RUTF) and low-calorie sweetener tablets in the food segment. COASTAL CONSOLIDATED: ICRA Reaffirms C Rating on INR6.5cr Loan -------------------------------------------------------------- ICRA has reaffirmed ratings on certain bank facilities of Coastal Consolidated Structures Pvt. Ltd (CCSPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term– Fund-based limits 6.50 [ICRA]C; reaffirmed Long-term/ Short-term– Non-fund based limits 9.50 [ICRA]C/[ICRA]A4; reaffirmed Long-term/ Short-term– Unallocated limits 21.00 [ICRA]C/[ICRA]A4; reaffirmed Rationale The ratings reaffirmation is constrained by CCSPL modest scale of operations with revenues of INR11.86 crore in FY2022 and high working capital intensity with long pending receivables from customers and the consequent stretched liquidity, as reflected by full utilisation of fund-based limits in the past 12 months. The company's revenues are exposed to high execution risk as majority of the order book is in the initial stages of execution (at less than 25% execution). The ratings are also constrained by the weak financial profile, as reflected by Total Debt/OPBIDTA of 5.4 times and TOL/TNW of 1.6 times in FY2022 on the back of higher debt levels. The ratings, however, favourably factor in the extensive experience of the promoters spanning over three decades in the civil construction industry. Going forward, the company's ability to improve its scale of operations and liquidity position while maintaining the operating profitability would be the key rating drivers. Key rating drivers and their description Credit strengths * Extensive experience of promoters in the construction industry spanning over two decades: CCSPL was established by Mr. M V Ranga Prasad in 1996 to execute civil works. The company has more than two decades of experience in executing civil works and specialises in marine structures like break water construction, jetties, slipways and in various civil and structural work such as excavation, dredging, road, and port work. Credit challenges * Small scale of operations and weak financial risk profile: The scale of operation continues to be modest with operating income of INR11.9 crore in FY2022. The company's financial risk profile was weak with Total Debt to OPBDITA of 5.39 times and TOL/TNW of 1.6 times in FY2022 owing to high debt levels. * High working capital intensity with delayed payments from clients resulting in tight liquidity position: CCSPL's working capital intensity remained high at ~196% in FY2022, owing to high debtors on the back of delayed payments from clients. The company has around INR8.2 crore of receivables outstanding for more than three years primarily from MARG Ltd. and Bharati Defence and Infrastructure Limited (formerly Bharati Shipyard Limited). Further, working capital limit utilisation has remained high in the past 12 months. Liquidity position: Stretched CCSPL's liquidity position is stretched due to limited cushion in working capital limits and low cash balances. The liquidity position is expected to remain stretched with slow execution of orders and delayed receivables. Rating sensitivities Positive factors – The ratings may be upgraded if there is a significant growth in revenues and earnings along with a reduction in working capital intensity, strengthening the liquidity profile of the company. Negative factors – The ratings may be downgraded in case of a stretch in the working capital cycle or losses in the business thereby further weakening the liquidity position. CCSPL, based out of Vijayawada, Andhra Pradesh was established in 1996 by Mr. M V Ranga Prasad and undertakes civil works such as excavation, dredging, road and ports. The company's operations are overseen by its Managing Director, Mr. M V Ranga Prasad, who is a mechanical engineer and has been involved in the construction industry for the past three decades. GSJ ENVO: ICRA Keeps B+ Debt Ratings in Not Cooperating Category ---------------------------------------------------------------- ICRA has retained the long-term ratings of GSJ Envo Limited in the 'Issuer Not Cooperating' category. The rating is denoted as "[ICRA]B+(Stable); ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term- 12.00 [ICRA]B+ (Stable) ISSUER NOT Fund Based- COOPERATING; Rating continues Cash Credit to remain under 'Issuer Not Cooperating' category Long Term- 70.00 [ICRA]B+ (Stable) ISSUER NOT Non Fund Based- COOPERATING; Rating continues Others to remain under 'Issuer Not Cooperating' category Long Term- 3.00 [ICRA]B+ (Stable) ISSUER NOT Unallocated COOPERATING; Rating continues to remain under 'Issuer Not Cooperating' category ICRA has been trying to seek information from the entity so as to monitor its performance. Further, ICRA has been sending repeated reminders to the entity for payment of surveillance fee that became due but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. The rating action has been taken in accordance with ICRA's policy in respect of non-cooperation by a rated entity available at www.icra.in. GSJ is involved in turnkey execution of projects in the fields of water and wastewater management, sewage treatment plants, underground reservoirs of booster pumping stations and sewage pumping stations. The company is also involved in the execution of civil work for hydroelectric power projects and multi-storied residential and industrial complexes. GSJ has a track record of over 40 years. Prior to its incorporation in August 1995 as GSJ Envo Limited, it functioned as the partnership firm, M/s GS Jolly. Currently, GSJ executes water and sewage treatment plants for various Government and private clientele including Delhi Jal Board, UP Jal Nigam, etc. HANUMAN RICE: ICRA Keeps B Debt Rating in Not Cooperating --------------------------------------------------------- ICRA has retained the Long-Term and Short-Term ratings of Hanuman Rice Mills in the 'Issuer Not Cooperating' category. The ratings are denoted as "[ICRA]B (Stable)/[ICRA]A4; ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term- 10.00 [ICRA]B (Stable) ISSUER NOT Fund Based- COOPERATING; Rating continues Cash Credit to remain under 'Issuer Not Cooperating' category Short Term- 5.00 [ICRA]A4 ISSUER NOT Non Fund Based COOPERATING; Rating continues to remain under 'Issuer Not Cooperating' category ICRA has been trying to seek information from the entity so as to monitor its performance. Further, ICRA has been sending repeated reminders to the entity for payment of surveillance fee that became due but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. The rating action has been taken in accordance with ICRA's policy in respect of non-cooperation by a rated entity available at www.icra.in. HRM was established in 1990 as a partnership firm with Mr. Shiv Parshad, Mr. Sushil Garg, Mr.Rajesh Garg and Mr. Subhash Garg as partners in equal ratio. After the demise of Mr. Subhash Garg in 2009, the partnership firm was reconstituted and Mr. Vipin Garg was admitted as a partner with equal share in the firm. HRM carries out processing and trading of rice in the domestic market and also exports to the Middle East and Europe. HRM has two plants with an overall capacity of 10 tonnes per hour at Taraori, Karnal (Haryana). HINDUSTAN CONSTRUCTION: CARE Ups INR3,697.38cr Loan Rating to B+ ---------------------------------------------------------------- CARE has revised the ratings of bank facilities from CARE D to CARE B+; Stable and withdrawn the outstanding ratings assigned to the bank facilities of Hindustan Construction Company Ltd. (HCC) with immediate effect. The action has been taken at the request of HCC and 'No Objection Certificate' received from the consortium leader for the facilities rated by CARE. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term/ 3,697.38 CARE B+; Stable/CARE A4 Short Term Revised from CARE D/ CARE D Bank Facilities The revision in ratings factor in successful implementation of debt resolution plan (RP) with subsequent regularization of debt servicing. CARE Ratings expect the liquidity position to improve with debt reduction in books of HCC as well as benefits accruing with extended repayment tenor for the Optionally Convertible Debentures (OCD) and Non-Convertible Debenture (NCD) which is likely to provide support to cashflows. The debt reduction and corresponding interest cost decrease is expected to improve the profitability. The company is also at advanced stage of asset monetization which would support the cashflows. Any deviation from the likely timelines would be a key monitorable. The ratings also factor in satisfactory order book position which provides a long term revenue visibility and established track record of the company in the construction business. The rating strengths are however tempered by the elongated working capital with extended collection days and working capital gap with absence of working capital lines thereby resulting in dependence upon mobilization advances and creditors funding. HCC continued to report cash loss in FY22 (refers to period April 01 to March 31) and H1FY23 and the past losses have been eroding the networth position resulting in weak solvency position. Also, HCC has extended corporate guarantee in favour of PRPL's lenders for the debt novated by it to the SPV (i.e., Prolific Resolution Private Limited, PRPL) and pledged its shares in the PRPL to secure the NCDs issued by later. While the repayment obligations of PRPL are deferred till FY27, any cashflow mismatch in the SPV in future periods and crystallization of such guarantee would be important from credit perspective. Rating sensitivities Positive factors – Factors that could lead to positive rating action/upgrade: * Improvement in collection period with subsequent easing of liquidity pressure * Growth in scale of operation and profitability along with improvement in debt coverage metrics Negative factors – Factors that could lead to negative rating action/downgrade: * Significant elongation of operating cycle with pressure on working capital position * Non fructification of envisaged asset monetization plans impacting the liquidity position Detailed description of the key rating drivers Key rating strengths * Implementation of Debt Resolution Plan with regularization of debt servicing: The company has successfully implemented Debt Resolution Plan as on September 30, 2022 effective from July 1, 2022. As per the RP, HCC has novated debt of INR2,854.4 crore along with beneficial economic interest in arbitration and claims of INR6,508 crore to Prolific Resolution Private Limited, a wholly owned subsidiary of the company. HCC does not have debt repayments (including interest) till March 2023 while the debt repayments of PRPL will commence from September 2026. The debt servicing has been regularized with debt restructuring. The RP implementation is expected to result in improvement in liquidity profile with reduction in debt level and extension of repayment terms which would provide buffer to the cashflows. The associated interest cost reduction would also aid the profitability metrics and the cash generation during the period is expected to provide the required working capital to scale up the business. HCC has entered into binding agreement with Cube Highways and Infrastructure V Pte Ltd. for 100% sale of Baharampore Farakka Highways Limited with the transaction likely to get completed in early fiscal of FY24. The monetization would support the liquidity profile and is important for the ensuing debt servicing in March 2023. The ability to complete the monetization would be critical from credit perspective. * Satisfactory and diversified order book position: HCC had an order book of INR13,784 crore as on Sept 30, 2022 which is about 3.3x the total operating income of the company during FY22 thereby providing medium term revenue visibility. The company has presence across various segments with order book spread across Transportation segment (49%), Hydro (24%), Water works (18%) and Nuclear and Special segment (9%). Key rating weaknesses * Weak financial performance with losses reported: The company continued to report losses during FY22 on account of high interest expenses, although the quantum of loss has reduced vis-à-vis previous year. The company reported total operating income of INR4,261 crore during FY22 having improved from INR2,359 crore during FY21 on account of higher execution of projects post slowdown due to covid related issues. The PBILDT margin improved from 2.21% during FY21 to 8.44% during FY22. For H1FY23, although HCC reported PAT of INR162 crore, the same is largely due to non-operating income in the form of reduction in liabilities to lenders due to restructuring of debt resulting in gain of INR223 crore. However, it continued to report cash loss. * Subdued leverage and debt coverage metrics: The losses incurred in the past have resulted in networth erosion which along with high debt level has resulted in leveraged capital structure and weak coverage metrics. While the RP implementation has resulted in reduction in debt level, the capital structure is expected to remain leveraged. * Extended working capital cycle: The operating cycle of the company has been extended with large debtors built up. The collection days has been significantly stretched with large debtors under arbitration/pending with clients. The company also does not have working capital lines for funding the gross current assets and relies on advances from customers/creditors funding. Liquidity: Stretched The liquidity profile although expected to improve post implementation of RP continues to remain stretched with moderate cash accrual generation vis-à-vis the debt repayment obligation due in March 2023. Comfort is drawn from the existing cash balance (Rs.120 crore as on December 27, 2022) available to partly fund the debt servicing obligation. Post March 2023, the next repayment liability falls due in March 2024. HCC was promoted by late Mr. Walchand Hirachand in 1926 and is presently spearheaded by Mr. Ajit Gulabchand, Chairman and Managing Director. HCC is one of the largest construction companies in India, engaged in construction activities which include roads, bridges, ports, power stations, water supply and irrigation projects. The company's construction capabilities include solutions for construction of projects in various complex industries including hydel power, water solution systems, nuclear power and process plants and transportation. JEEVISHA FOODS: ICRA Keeps B+ Debt Ratings in Not Cooperating ------------------------------------------------------------- ICRA has retained the Long-Term rating of Jeevisha Foods Pvt. Ltd. in the 'Issuer Not Cooperating' category. The rating is denoted as "[ICRA]B+ (Stable); ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term- 4.80 [ICRA]B+ (Stable) ISSUER NOT Fund Based- COOPERATING; Rating continues Cash Credit to remain under 'Issuer Not Cooperating' category Long Term- 5.50 [ICRA]B+ (Stable) ISSUER NOT Fund Based- COOPERATING; Rating continues Term Loan to remain under 'Issuer Not Cooperating' category ICRA has been trying to seek information from the entity so as to monitor its performance. Further, ICRA has been sending repeated reminders to the entity for payment of surveillance fee that became due but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. The rating action has been taken in accordance with ICRA's policy in respect of non-cooperation by a rated entity available at www.icra.in. Jeevisha Foods Private Limited was incorporated in 2013 and is engaged in milling of basmati rice. The manufacturing unit of the firm is based in Kaithal (Haryana) with a milling capacity of 8 tonnes per hour (TPH) and has sortex machinery with a capacity of 8 TPH. The operations of the firm are actively managed by Mr. Nikhil Chhabra. KAI INTERNATIONAL: ICRA Keeps B+ Debt Ratings in Not Cooperating ---------------------------------------------------------------- ICRA has retained the Long-Term and Short-Term ratings of K A I International Pvt. Ltd. in the 'Issuer Not Cooperating' category. The ratings are denoted as "[ICRA]B+ (Stable)/[ICRA]A4; ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term- 27.50 [ICRA]B+ (Stable) ISSUER NOT Fund Based- COOPERATING; Rating continues Cash Credit to remain under 'Issuer Not Cooperating' category Short Term- 43.72 [ICRA]A4 ISSUER NOT Non Fund Based COOPERATING; Rating continues to remain under 'Issuer Not Cooperating' category Long Term/ 16.78 [ICRA]B+(Stable)/[ICRA]A4; Short Term- ISSUER NOT COOPERATING; Unallocated Rating Continues to remain under issuer not cooperating category ICRA has been trying to seek information from the entity so as to monitor its performance. Further, ICRA has been sending repeated reminders to the entity for payment of surveillance fee that became due. Despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. The rating action has been taken in accordance with ICRA's policy in respect of non-cooperation by a rated entity available at www.icra.in. Incorporated in 2007, K A I International Pvt. Ltd. (KIPL) belongs to the Odisha-based Kalinga Group. The company mainly trades in the raw materials used in steel manufacturing, mainly iron ore, coal as well as other intermediate steel products including billets. KIPL imports coal and exports iron ore as well as billets from time to time. Previously, the promoters were involved in trading business through a partnership firm. Subsequently, the trading operations were shifted to KIPL. The company plans to set up an iron ore pelletisation and beneficiation facility in Sundargarh district of Odisha. LAKHOTIA TRANSPORT: ICRA Keeps B+ Debt Ratings in Not Cooperating ----------------------------------------------------------------- ICRA has retained the Long-Term and Short-Term ratings of Lakhotia Transport Co. Pvt. Ltd. in the 'Issuer Not Cooperating' category. The ratings are denoted as "[ICRA]B+ (Stable)/ [ICRA]A4; ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term- 46.00 [ICRA]B+ (Stable) ISSUER NOT Fund Based- COOPERATING; Rating continues Cash Credit to remain under 'Issuer Not Cooperating' category Short Term- (16.00) [ICRA]A4 ISSUER NOT Interchangeable COOPERATING; Rating continues to remain under 'Issuer Not Cooperating' category ICRA has been trying to seek information from the entity so as to monitor its performance. Further, ICRA has been sending repeated reminders to the entity for payment of surveillance fee that became due but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. The rating action has been taken in accordance with ICRA's policy in respect of non-cooperation by a rated entity available at www.icra.in. Lakhotia Transport Co. Pvt. Ltd. (LTCPL) was incorporated in 1962 as Lakhotia Transportation Company and was converted into a private limited company in 2001. The company provides logistics solutions through road for various entities in the fastmoving consumer goods (FMCG) segment, steel sector etc. LTCPL has 27 branches across the country. The company requires around 125 trucks daily, ~10% of which is met by its own vehicles. MODERN AGRO: ICRA Keeps B+ Debt Rating in Not Cooperating --------------------------------------------------------- ICRA has retained the Long-Term rating of Modern Agro Mills in the 'Issuer Not Cooperating' category. The rating is denoted as "[ICRA]B+ (Stable); ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term- 90.00 [ICRA]B+ (Stable) ISSUER NOT Fund Based- COOPERATING; Rating continues Cash Credit to remain under 'Issuer Not Cooperating' category ICRA has been trying to seek information from the entity so as to monitor its performance. Further, ICRA has been sending repeated reminders to the entity for payment of surveillance fee that became due but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. The rating action has been taken in accordance with ICRA's policy in respect of non-cooperation by a rated entity available at www.icra.in. Modern Agro Mills was established in 2008 as a partnership firm by Mr. Nishant Malik and his family members. The firm is engaged in trading and milling of basmati rice. The firm's milling unit is located in Karnal, Haryana and has an installed capacity of 8 tonnes per hour. PAVANSUT PAPER: ICRA Keeps B+ Debt Ratings in Not Cooperating ------------------------------------------------------------- ICRA has retained the Long-Term and Short-Term ratings of Pavansut Paper Mill Pvt. Ltd. in the 'Issuer Not Cooperating' category. The ratings are denoted as "[ICRA]B+ (Stable)/ [ICRA]A4; ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term- 8.50 [ICRA]B+ (Stable) ISSUER NOT Fund Based- COOPERATING; Rating continues Cash Credit to remain under 'Issuer Not Cooperating' category Long Term- 4.04 [ICRA]B+ (Stable) ISSUER NOT Fund Based- COOPERATING; Rating continues Term Loan to remain under 'Issuer Not Cooperating' category Short Term- 0.70 [ICRA]A4 ISSUER NOT Non Fund Based COOPERATING; Rating continues to remain under 'Issuer Not Cooperating' category Long Term/ 2.96 [ICRA]B+(Stable)/[ICRA]A4; Short Term- ISSUER NOT COOPERATING; Unallocated Rating Continues to remain under issuer not cooperating category ICRA has been trying to seek information from the entity so as to monitor its performance. Further, ICRA has been sending repeated reminders to the entity for payment of surveillance fee that became due but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. The rating action has been taken in accordance with ICRA's policy in respect of non-cooperation by a rated entity available at www.icra.in. Incorporated in October 2015 as a private limited company, Pavansut Paper Mill Pvt. Ltd. (Pavansut) manufactures kraft paper in varying BF sizes from 12 to 22, which is used for manufacturing corrugated boxes. The company's plant is in Morbi, Gujarat and has a manufacturing capacity of 100 tonne/day. The operations are managed by members of the Patel family, who have extensive experience in the paper industry by virtue of their erstwhile association in a related business. PURANDAR MILK: ICRA Keeps D Debt Ratings in Not Cooperating ----------------------------------------------------------- ICRA has retained the Long-Term rating of Purandar Milk and Agro Products Limited in the 'Issuer Not Cooperating' category. The rating is denoted as "[ICRA]D; ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term– 0.90 [ICRA]D; ISSUER NOT COOPERATING; Fund based Rating Continues to remain under Cash Credit 'Issuer Not Cooperating' Category Long-term– 5.00 [ICRA]D; ISSUER NOT COOPERATING; Fund based Rating Continues to remain under Term Loan 'Issuer Not Cooperating' Category Long-term– 1.10 [ICRA]D; ISSUER NOT COOPERATING; Fund based Rating Continues to remain under Unallocated 'Issuer Not Cooperating' Category ICRA has been trying to seek information from the entity so as to monitor its performance. Further, ICRA has been sending repeated reminders to the entity for payment of surveillance fee that became due but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. The rating action has been taken in accordance with ICRA's policy in respect of non-cooperation by a rated entity available at www.icra.in. Purandar Milk and Agro Products Limited was established in 2000 and commenced operations in 2001.The company is involved in procurement, processing and sale of milk and milk products, trading of petroleum products, petrol and diesel and weigh bridge operations. The milk processing capacity of the company is 30,000 litres per day. The company markets milk and milk products in the nearby metros under the brand name 'ANANDI'. PMAPL is part of Silver Jubilee Group promoted by Mr. Sanjay Jagtap which has diversified interests ranging from automobile dealership, dairy, real estate to investment advisory services. The prominent among them include Silver Jubilee Motors Limited (promoted along with Mr. Kiranpalsingh Ahluwalia) involved in sales and services of Mahindra and Mahindra utility vehicles. PMAPL has set up a 5000 metric ton per month capacity cold storage plant in Khalad, Pune (Maharashtra). RAM INDUSTRIES: ICRA Reaffirms B+ Rating on INR7.40cr Loan ---------------------------------------------------------- ICRA has reaffirmed ratings on certain bank facilities of Sri Ram Industries (SRI), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund Based- 7.40 [ICRA]B+(Stable); reaffirmed Working capital Fund Based- 2.04 [ICRA]B+(Stable); reaffirmed Term Loan Unallocated 1.06 [ICRA]B+(Stable); reaffirmed Rationale The rating continues to factor in SRI's moderate scale of operations (revenues of INR32.9 crore in FY2022) with limited value addition in the nature of work done, its modest debt protection metrics (interest cover of 1.5 times in FY2022) and presence in a highly fragmented and competitive rice milling industry, which limits the pricing power. The rating remains constrained by the susceptibility of the firm's revenues and margins to volatile paddy prices, modest debt coverage metrics and adverse changes in agro-climatic conditions as well as Government regulation, which can affect the availability of paddy. Additionally, the rating remains constrained by the risks associated with the partnership nature of the firm The rating, however, continues to derive comfort from the extensive experience of its promoters in the rice milling industry and easy availability of paddy because of its proximity to major paddy-cultivating regions in northern Karnataka. ICRA considers the favourable demand prospects of the rice industry because of India's growing population. Additionally, India is one of the largest producers and consumers of rice. The Stable outlook on the [ICRA]B+ rating reflects ICRA's opinion that SRI will continue to benefit from the extensive experience of its promoters in the rice milling business and its proximity to rice-growing areas. Key rating drivers and their description Credit strengths * Extensive experience of promoters in rice milling business: Incorporated in 2007, SRI is a partnership firm involved in the processing of raw rice and parboiled rice. The promoters have been involved in the rice milling business for over two decades. The sale of whole rice contributes to a major portion of its revenues. * Proximity to rice-growing areas: The firm's plant is located in Manvi, Karnataka, which is surrounded by areas such as Raichur, Sindhnoor and Gangavathi, where a major part of the paddy is cultivated in Karnataka. This results in low transportation cost and easy availability of paddy. * Favourable long-term demand outlook: The demand prospects of the rice industry are expected to remain favorable, supported by India's growing population with rice remaining a staple food grain in the country. Moreover, India is the world's second largest consumer of rice. Credit challenge * Moderate scale of operations and modest debt protection metrics: SRI's revenues remained moderate at INR32.9 crore in FY2022 and INR30.9 crore in FY2021, which along with its low net worth, restricts the firm's ability to tide over adverse circumstances. Its debt protection metrics remained modest with interest coverage of 1.5 times, DSCR of 1 times and TD/OPBITDA of 3.6 times in FY2022. * Presence in highly fragmented and competitive industry, which limits pricing power: Owing to low entry barriers, along with readily available technology and proximity to rice-cultivating belt, there are more than 100 rice milling units in and around Raichur, leading to intense competition for paddy procurement. This affects volumes and pricing flexibility of rice millers like SRI. * Inherent agro-climatic risks and vulnerability to changes in Government policies: In the agricultural business, industry players continue to face inherent risks such as unfavourable monsoons, availability of raw materials at reasonable prices, epidemics in paddy crop or shift of farmers to other cash crops and cyclicality, as well as changes in Government regulations. * Inherent risks associated with partnership nature of business: SRI is exposed to risks associated with partnership firms including limited ability to raise capital and capital withdrawal by partners, which could adversely impact its capital structure. Liquidity position: Stretched SRI's liquidity position remains stretched with dependency on external borrowings for raw material procurement due to high inventory holding requirements, minimal cash and equivalents of INR1.07 lakh as on December 20, 2022 and thin free cash flows. The firm has an outstanding term loan of INR1.40 crore as on November 30, 2022, part of which is to be fully repaid by FY2024 and the remaining is to be repaid by FY2026. SRI has INR7.4 crore working capital limits and its average utilisation stood at 60% of the sanctioned limits in YTD FY2023. Rating sensitivities Positive factors – ICRA could upgrade the rating in case of significant and sustainable increase in scale of operations and earnings, along with improvement in debt protection metrics and liquidity position. Negative factors – Negative pressure on SRI's rating could arise in case of a decline in revenues or margins lead to weakened debt protection metrics. Any withdrawal of capital or increase in working capital intensity leading to stretch in liquidity position can also lead to a downgrade. Incorporated in 2007, Sri Ram Industries is a partnership firm involved in milling of paddy and produces raw rice. The firm's major products include boiled rice, raw rice, bran, broken rice and husk. SRI has a milling unit in Manvi, in Raichur district, Karnataka with an installed milling capacity of 4 MT per hour. Its plant is spread over 3.5 acres with a storage capacity of 80,000 bags (75 kg each) of paddy and 250 MT of rice. SRI sells raw rice under eight brands namely, KDM, Ram, Shilpa, RSK, MVM, AKS, VTC and Double Parrot. Also, it sells broken rice under two brands namely, Rabbit and Helicopter. RAPID METRORAIL GURGAON: ICRA Keeps D Rating in Not Cooperating --------------------------------------------------------------- ICRA has retained the Long-Term rating of Rapid Metrorail Gurgaon South Limited in the 'Issuer Not Cooperating' category. The rating is denoted as [ICRA]D; ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term– 1500.00 [ICRA]D; ISSUER NOT COOPERATING; Fund based Rating Continues to remain under Term Loan 'Issuer Not Cooperating' Category ICRA has been trying to seek information from the entity so as to monitor its performance. Further, ICRA has been sending repeated reminders to the entity for payment of surveillance fee that became due but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. The rating action has been taken in accordance with ICRA's policy in respect of non-cooperation by a rated entity available at www.icra.in. RMGSL, a Special Purpose Vehicle (SPV), was incorporated with the aim of implementing a Metro link from DMRC Sikandarpur Station to Sector-56, in Gurgaon under concession from HUDA in Public Private Partnership. The SPV's sponsors are IL&FS Rail Limited (IRL) (65.0%) and IL &FS Transportation Networks Limited (ITNL) (35.0%). The scope of the project includes design performance and execution, engineering, financing, procurement, construction, installation, commissioning and testing of the works together with subsequent operation and maintenance of the entire project. HUDA has granted the concession to the SPV for a period of 98 years starting from July 2, 2013. RAPID METRORAIL: ICRA Keeps D Debt Rating in Not Cooperating ------------------------------------------------------------ ICRA has retained the Long-Term rating of Rapid Metrorail Gurgaon limited in the 'Issuer Not Cooperating' category. The rating is denoted as [ICRA]D; ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term– 761.60 [ICRA]D; ISSUER NOT COOPERATING; Fund based Rating Continues to remain under Term Loan 'Issuer Not Cooperating' Category ICRA has been trying to seek information from the entity so as to monitor its performance. Further, ICRA has been sending repeated reminders to the entity for payment of surveillance fee that became due but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. The rating action has been taken in accordance with ICRA's policy in respect of non-cooperation by a rated entity available at www.icra.in. RMGL is a Special Purpose Vehicle (SPV) incorporated with the purpose of implementing the metro link from Delhi Metro Rail Corporation (DMRC) Sikandarpur Station to National Highway-8 (NH-8) in Gurgaon (Haryana) under concession from Haryana Urban Development Authority (HUDA) in Public Private Partnership. The scope of the project includes the performance and execution of design, engineering, financing, procurement, construction, installation, commissioning and testing of the works together with subsequent operations and maintenance of the entire project. The concession has been granted by HUDA to the SPV for a period of 99 years starting from December 9, 2009. The metro became operational on November 14, 2013. The project was completed at a cost of INR1,241 crore (including DSRA), as against the initially expected project cost of INR1,088 crore. The cost over runs incurred to complete the project has been entirely funded through promoters' incremental contribution. The metro commenced operations with a fare of Rs. 12 per ride, however, the same was increased to INR20 per ride in August 2014 under provisions of The Metro Railway Operations & Maintenance Act 2002. The CA specifies connectivity charges of INR5 crore to be paid to HUDA within 60 days of signing the CA and INR40 crore per year from the 17th to 35th year. Also, HUDA will have a revenue share on non-fare annual revenues starting from 5% and going up to 10% which will be paid on yearly basis. The CA also entitles RMGL to collect revenues related to the passenger fares, advertising revenues and real estate revenues The sponsors in the SPV are IL&FS group companies including IL&FS Rail Limited, IL&FS Incubation Trust and IL&FS Transport Networks Limited (ITNL) which hold 49.58%, 47.58% and 2.89% shareholding respectively. ROBO EQUIPMENTS: ICRA Keeps B+ Debt Ratings in Not Cooperating -------------------------------------------------------------- ICRA has moved the ratings for the bank facilities of Robo Equipments and Forgings Private Limited (REFPL) to the 'Issuer Not Cooperating' category. The rating is denoted as "[ICRA]B+(Stable)/[ICRA]A4; ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term- 12.00 [ICRA]B+ (Stable) ISSUER NOT Fund Based- COOPERATING; Rating moved to Cash Credit the 'Issuer Not Cooperating' category Long Term- 2.00 [ICRA]B+ (Stable) ISSUER NOT Non Fund Based- COOPERATING; Rating moved to Bank guarantee the 'Issuer Not Cooperating' category Unallocated 6.00 [ICRA]B+ (Stable)/[ICRA]A4 Limits ISSUER NOT COOPERATING; Rating moved to the 'Issuer Not Cooperating' category As a part of its process and in accordance with its rating agreement with PML, ICRA has been trying to seek information from the entity to monitor its performance. Despite repeated requests by ICRA, the entity's management has remained noncooperative. In absence of requisite information and in line with the aforesaid policy of ICRA, a rating view has been taken on the entity based on the best available information. REFPL was incorporated in 2010 and started commercial operations in June 2012. The company is involved in fabrication of heavy steel structure mainly used in power projects and conveyor belts. Its fabrication unit has a capacity of 9,600 MT per annum and is in Sangareddy, Telangana. The company is promoted by Mr. B. V. Sivarama Raju. REFPL is an approved vendor of Larsen & Toubro and Bharat Heavy Electricals Limited (BHEL). SALEM DISTRICT: ICRA Lowers Rating on INR60cr LT Loan to B+ ----------------------------------------------------------- ICRA has revised ratings on certain bank facilities of Salem District Co-Operative Milk Producer Union Limited, as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term- 60.00 [ICRA]B+ (Stable) ISSUER NOT Fund-based- COOPERATING; Rating downgraded Cash Credit from [ICRA]BB (Stable)and continues to remain in the 'Issuer Not Cooperating' Category Rationale The ratings downgrade is because of lack of adequate information regarding Salem District Co-Operative Milk Producer Union Limited performance and hence the uncertainty around its credit risk. ICRA assesses whether the information available about the entity is commensurate with its rating and reviews the same as per its "Policy in respect of non-cooperation by a rated entity" available at www.icra.in. The lenders, investors and other market participants are thus advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity, despite the downgrade. As part of its process and in accordance with its rating agreement with Salem District Co-Operative Milk Producer, ICRA has been trying to seek information from the entity so as to monitor its performance, and has been sending repeated reminders to the entity for payment of surveillance fee that became due. However, despite multiple requests by ICRA, the entity's management has remained non-cooperative. In the absence of requisite information and in line with the aforesaid policy of ICRA, a rating view has been taken on the entity based on the best available information. Salem District Cooperative Milk Producers Union Ltd, established as cooperative society in 1983 is involved in processing and manufacturing of milk and its byproducts. The Union sells products such as Milks, curds, milk powder, ghee, butter, ice cream, sweets, among others under the brand name "Aavin" predominantly in Tamil Nadu. It has a milk processing capacity of 5 lakhs litres per day, butter production capacity of 12 MT/day, ghee production capacity of 6 MT/day, skimmed milk powder processing capacity of 8 MT/day. The registered office is in Salem district, Tamil Nadu. Salem District Cooperative Milk Producers Union Ltd (SDCMPUL) is owned by Government of Tamil Nadu (51.8% shareholding) and 715 milk societies of Erode District (48.2% shareholding). Tamil Nadu Dairy Development Corporation Limited was formed in July 1972 to manage the activities such as milk procurement, processing and marketing of the milk and milk products. The Namakkal union was separated from Salem union in FY2020 and hence share holdings of Namakkal Union was withdrawn which resulted in reduction of public shareholding from existing 57.5% to 48.2%. which resulted in increase in government of Tamilnadu shareholding from existing 42.5% to 51.8% without any fresh capital infusion. The Department of Dairy Development in Tamil Nadu was set up in 1958. The Tamil Nadu Dairy Development Corporation Limited was formed in July 1972 to manage milk procurement, processing and marketing of milk and milk products. Tamil Nadu Co-operative Milk Producers' Federation (TNMF) was formed in February 1981 as an apex body of three tier cooperatives set up in Tamil Nadu and the district level milk producer unions were formed in 1982. The commercial activities of Tamil Nadu Dairy Development Corporation Ltd., were transferred to the newly registered TNMF, popularly known as Aavin. SANJIB DEKA: CARE Moves B+ Debt Rating to Not Cooperating --------------------------------------------------------- CARE Ratings has moved the ratings on certain bank facilities of Sanjib Deka, as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 5.00 CARE B+; Stable; ISSUER NOT Facilities COOPERATING; Rating moved to ISSUER NOT COOPERATING category Short Term Bank 2.50 CARE A4; ISSUER NOT Facilities COOPERATING; Rating moved to ISSUER NOT COOPERATING category Detailed rationale and key rating drivers CARE Ratings Ltd. has placed the rating(s) of Sanjib Deka under the 'issuer non-cooperating' category as it has failed to provide information for monitoring of the rating and had not paid the surveillance fees for the rating exercise as agreed to in its Rating Agreement. Sanjib Deka continues to be non-cooperative despite repeated requests for submission of information through emails, phone calls and letter/emails dated October 12, 2022, November 4, 2022, November 15, 2022, December 5, 2022, December 12, 2022. In line with the extant SEBI guidelines, CARE Ratings Ltd. has reviewed the rating on the basis of the best available information which however, in CARE Ratings Ltd.'s opinion is not sufficient to arrive at a fair rating. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above rating(s). The ratings have been revised on account of lack of adequate information and uncertainty around the credit risk profile of the company. The rating continues to remain constrained by constitution as a proprietorship firm, small scale of operation with moderate profitability margins and geographically concentrated order book, working capital intensive nature of operations resulted into leveraged capital structure and moderate debt coverage indicators and intense competition with tender driven process risk. The ratings, however, derive comfort from experienced proprietor with established track record of operations and satisfactory order book position. Rating Sensitivities Positive Factors - Factors that could lead to positive rating action/upgrade: * Sizable increase in total operating income (turnover > 50 crore) along with sustainable operating margin > 10% on a sustained basis. * Conversion of firm into a corporate entity. Negative Factors- Factors that could lead to negative rating action/downgrade: * Sizable de-growth in total operating income (turnover < 15 crore) along with deterioration in operating margin reaching SHAMLI STEELS: ICRA Keeps B+ Debt Ratings in Not Cooperating ------------------------------------------------------------ ICRA has retained the Long-Term and Short-Term ratings of Shamli Steels Private Limited in the 'Issuer Not Cooperating' category. The ratings are denoted as "[ICRA]B+ (Stable)/ [ICRA]A4; ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term- 15.00 [ICRA]B+ (Stable) ISSUER NOT Fund Based- COOPERATING; Rating continues Cash Credit to remain under 'Issuer Not Cooperating' category Long Term- 20.54 [ICRA]B+ (Stable) ISSUER NOT Fund Based- COOPERATING; Rating continues Term Loan to remain under 'Issuer Not Cooperating' category Short Term- 2.00 [ICRA]A4 ISSUER NOT Non Fund Based COOPERATING; Rating continues to remain under 'Issuer Not Cooperating' category ICRA has been trying to seek information from the entity so as to monitor its performance. Further, ICRA has been sending repeated reminders to the entity for payment of surveillance fee that became due. Despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. The rating action has been taken in accordance with ICRA's policy in respect of non-cooperation by a rated entity available at www.icra.in. SSPL was established in 1999 by Mr. Surender Jain and Mr. Sandeep Jain to manufacture mild steel (MS) ingots at its facility in Shamli, Uttar Pradesh, with an initial manufacturing capacity of around 14,400 tonnes per annum (TPA) which was enhanced to 27,000 MTPA in February, 2013. In 2009, Mr Sudhir Kumar Bansal joined SSPL and the promoters decided to forward integrate into rolled products and established a MS rolling mill with a capacity of 90,000 TPA. SSPL is a part of the Jai Bharat Group, and sells the rolled products under the brand 'Jai Bharat Steels'. SHASHWAT CLEANTECH: CARE Lowers Rating on INR15cr Loan to B+/A4 --------------------------------------------------------------- CARE Ratings has revised the ratings on certain bank facilities of Shashwat Cleantech Private Limited (SCPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term/Short 15.00 CARE B+; Stable/CARE A4; Term Bank ISSUER NOT COOPERATING; Facilities Rating continues to remain under ISSUER NOT COOPERATING category and Revised from CARE BB+ (CE);Stable/CARE A4+ (CE) Short Term Bank 4.00 CARE A4; ISSUER NOT Facilities COOPERATING; Rating continues to remain under ISSUER NOT COOPERATING category and Revised from CARE A4+ (CE) Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated April 1, 2022, placed the rating(s) of SCPL under the 'issuer non-cooperating' category as SCPL had failed to provide information for monitoring of the rating and had not paid the surveillance fees for the rating exercise as agreed to in its Rating Agreement. SCPL continues to be noncooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated December 26, 2022, December 27, 2022 and December 28, 2022. In line with the extant SEBI guidelines, CARE Ratings Ltd. has reviewed the rating on the basis of the best available information which however, in CARE Ratings Ltd.'s opinion is not sufficient to arrive at a fair rating. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above rating(s). The revision in ratings assigned to the bank facilities of SCPL is due to non-availability of requisite information. The revision of ratings also factored in decrease in scale of operation with reporting operating losses in FY22(Audited, refers to period April 1 to March 31), deterioration in debt coverage indicators and elongation in operating cycle in FY22. The ratings are further constrained on account of its moderate capital structure. The ratings, however, continue to derive strength from experience of promoters in solar EPC industry. Further, CARE has withdrawn its unsupported rating due to change in analytical approach from 'Credit Enhancement' to 'Standalone'. Detailed description of the key rating drivers At the time of last rating on April 1, 2022 the following were the rating strengths and weaknesses (updated for the information available from Registrar of Companies): Key Rating Weaknesses * Decrease in scale of operation with reporting operating losses: SCPL's scale of operations decreased over previous year and continued to remain low during FY22 marked by a decline in total operating income to INR 10.14 crore during FY22 as compared to INR 26.04 crore during FY21. Consequently, profitability was also impacted as the company reported an operating loss during FY22 compared to an operating profit of INR 0.20 crore during FY21. However, with generating non-operating income during the year, SCPL is able to book nominal net profit at INR0.03 crore during FY22 (P.Y. INR0.04 crore). * Moderate capital structure and weak debt coverage: With decrease in overall debt capital structure of SCPL although improved but remained moderate marked by overall gearing of 1.46x as on March 31, 2022 as compared to 1.87x as on March 31, 2021. Further, with reporting losses at operating level, debt coverage indicators deteriorated over previous year and remained weak. * Elongated operating cycle Given the nature of business, the company's operating cycle elongated to 250 days in FY22 from 158 days in FY21 as a result of collective increase collection days and inventory days in FY22. Key Rating Strengths * Experience of promoters in solar EPC industry: SCPL is a part of Ahmedabad based Siddhi group. The management of SCPL is headed by Mr. Rajendra Patel and Mr. Kurang Panchal who have more than 25 years of experience in the field of EPC of electricity transmission and distribution through their other ventures namely RPSPL and Polycoat Electra Services (India) Private Limited (PESIPL). Further, the group is engaged in electrical contract work, trading of electrical components and solar system integration services. Thus, SCPL benefits from operational, financial and technical synergies with its associate companies. Analytical approach: Standalone revised from Credit enhanced rating (backed by unconditional and irrevocable corporate guarantee extended by RPSPL to the lender of SCPL) - Given that SCPL has been under the 'issuer not cooperating' category; hence CARE is unable to ascertain whether the corporate guarantee extended by Rajesh Power Services Private Limited still exists and if it does; whether it fulfils all stipulated conditions necessary for evaluation and consideration of the guarantee. SCPL, erstwhile incorporated as Shashwat Green Fuels & Technologies (India) Private Limited in 2008, is engaged in providing Engineering, Procurement & Construction (EPC) and Consulting services for on-grid and off-grid solar power projects. The company was promoted by Mr. Rajendra Patel and Mr. Kurang Panchal who have more than 25 years of experience in the field of EPC of electricity transmission and distribution through their other ventures namely RPSPL and Polycoat Electra Services (India) Private Limited (PESIPL). Subsequently, Mr. Karan Dangayach joined SCPL and he is currently looking after all day-today operations of the company. SICAL LOGISTICS: ICRA Keeps D Debt Ratings in Not Cooperating ------------------------------------------------------------- ICRA has retained the Long term and Short term ratings of Sical Logistics Limited in the 'Issuer Not Cooperating' category. The rating is denoted as "[ICRA]D/[ICRA]D; ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Non-Convertible 100.00 [ICRA]D; ISSUER NOT COOPERATING; Debenture Continues to remain under the Programme 'Issuer Not Cooperating' Category Long Term- 300.00 [ICRA]D; ISSUER NOT COOPERATING; Cash Credit Rating Continues to remain under 'Issuer Not Cooperating' Category Long Term- 526.01 [ICRA]D; ISSUER NOT COOPERATING; Term Loan Rating Continues to remain under 'Issuer Not Cooperating' Category Long-term– 6.53 [ICRA]D; ISSUER NOT COOPERATING; Unallocated Rating Continues to remain under 'Issuer Not Cooperating' Category Short-term 29.50 [ICRA]D; ISSUER NOT COOPERATING; fund based Continues to remain under the facilities 'Issuer Not Cooperating' Category ICRA has been trying to seek information from the entity so as to monitor its performance. Further, ICRA has been sending repeated reminders to the entity for payment of surveillance fee that became due but despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. The rating action has been taken in accordance with ICRA's policy in respect of non-cooperation by a rated entity available at www.icra.in. Incorporated in 1955, SLL is involved in the business of mining, multi-modal logistics for bulk and containerised cargo port terminals, port handling, trucking and warehousing, ship agency, customhouse agency, offshore supply logistics and retail logistics. On a consolidated basis, SLL has investments in infrastructure including a port terminal, container freight stations, container rail and a dredger. SLL was promoted by Mr. M. A. Chidambaram Chettiar to provide shipping and custom agency services apart from its core activity of trading. Over the years, SLL entered areas such as port handling, container terminal operations (through JV) and logistics. In 2005, SLL hived off its non-core activities and increased its focus on the logistics business. In the recent years, SLL entered mining by executing coal/overburden removal contracts for Coal India subsidiaries, which rapidly grew into one of the major revenue contributors of the company. Tanglin Retail Reality Developments (P) Limited (part of the Coffee Day Group) picked up 10% stake initially in November 2010 before raising the stake to 54.2%. The Coffee Day Group, at present, holds a total 38.49% shareholding in SLL through its Group entities namely Tanglin (32.82%) and GiriVidyuth (India) Ltd (4.99%). The Coffee Day Group has a diversified portfolio of companies, which have presence in owning and managing coffee plantations, coffee exports; and retailing of coffee, vending machines and cafes. It is also involved in leasing of commercial space, financial services, hospitality services and others. SRINIVASA ENTERPRISES: ICRA Cuts Rating on INR6.25cr Loan to B+ --------------------------------------------------------------- ICRA has revised the ratings on certain bank facilities of Srinivasa Enterprises, as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term– 6.25 [ICRA]B+(Stable); ISSUER NOT Fund-based COOPERATING; Rating downgraded from [ICRA]BB (Stable) and moved to the 'Issuer Not Cooperating' category Short-term– 17.20 [ICRA]A4; ISSUER NOT Non-fund based– COOPERATING; moved to the Bank guarantee 'Issuer Not Cooperating' Category Long-term/ 6.55 [ICRA]B+(Stable)/[ICRA]A4; Short-term– ISSUER NOT COOPERATING; Unallocated Rating downgraded from [ICRA]BB (Stable) and moved to the 'Issuer Not Cooperating' category Rationale The rating downgrade is because of lack of adequate information regarding Srinivasa Enterprises' performance and hence the uncertainty around its credit risk. ICRA assesses whether the information available about the entity is commensurate with its rating and reviews the same as per its "Policy in respect of non-cooperation by a rated entity" available at www.icra.in. The lenders, investors and other market participants are thus advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity, despite the downgrade. As a part of its process and in accordance with its rating agreement with Srinivasa Enterprises, ICRA has been trying to seek information from the entity so as to monitor its performance. Despite repeated requests by ICRA, the entity's management has remained non-cooperative. In absence of requisite information and in line with the aforesaid policy of ICRA, a rating view has been taken on the entity based on the best available information. Srinivasa Enterprises was founded in 2001 as a partnership firm by Mr. N. Rambabu and Mr. B. Jeevan Kishore. However, in November 2014, Mr. N. Rambabu retired from the firm and Mr. B. Kranti Kishore was inducted as a new partner. The firm executes building construction works for state government departments. It is a Class-I contractor in Karnataka, Andhra Pradesh and Telangana, executing projects for H&FWD, APEWIDC and TSMSIDC. TARA CHAND: ICRA Keeps D Debt Rating in Not Cooperating Category ---------------------------------------------------------------- ICRA has retained the Long-Term rating of Tara Chand Rice Mills Pvt. Ltd. in the 'Issuer Not Cooperating' category. The rating is denoted as "[ICRA]D; ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term– 150.00 [ICRA]D; ISSUER NOT COOPERATING; Fund based Rating Continues to remain under Cash Credit 'Issuer Not Cooperating' Category ICRA has been trying to seek information from the entity so as to monitor its performance. Further, ICRA has been sending repeated reminders to the entity for payment of surveillance fee that became due. Despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. The rating action has been taken in accordance with ICRA's policy in respect of non-cooperation by a rated entity available at www.icra.in. TCRM took over Tara Chand Rice Mills on September 5, 2013, along with all its assets and liabilities. The company is primarily involved in milling basmati rice. TCRM's milling unit is based at Nissing in Karnal, Haryana and is close to the local grain market. The company also exports rice to countries such as Saudi Arabia and Dubai. TREE HOUSE: CARE Keeps D Debt Rating in Not Cooperating ------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Tree House Education & Accessories Limited (THEAL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 102.80 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed rationale and key rating drivers CARE Ratings Ltd. had, earlier vide its press release dated October 20, 2020, placed the rating of THEAL under the 'issuer non-cooperating' category as Tree House Education & Accessories Limited had failed to provide information for monitoring of the rating. THEAL continues to be non-cooperative despite repeated requests for submission of information through phone calls and emails dated September 06, 2022, September 10, 2022 and September 11, 2022, In line with the extant SEBI guidelines, CARE Ratings Ltd. has reviewed the rating on the basis of the best available information which however, in CARE Ratings Ltd. opinion is not sufficient to arrive at a fair rating. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above rating. Detailed description of the key rating drivers At the time of last rating on October 11, 2021, the following were the rating strengths and weaknesses Key rating weaknesses Delay in debt-servicing obligations: The ratings of Tree house Education & Accessories Ltd continue to reflect on-going delays in servicing of debt obligations by the company. Tree House Education & Accessories Ltd incorporated on July 10, 2006 as a private limited company by Mr. Rajesh Bhatia and his wife Ms. Geeta Bhatia, is primarily engaged in pre-school education across various locations in India. As on date there are 524 pre-school centers across the country. THEAL also operates in K12 segment with 24 schools under its management. VAMA INFRA: ICRA Keeps B+ Debt Rating in Not Cooperating Category ----------------------------------------------------------------- ICRA has retained the Long-Term rating of Vama Infra in the 'Issuer Not Cooperating' category. The rating is denoted as [ICRA]B+(Stable); ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term- 20.00 [ICRA]B+ (Stable) ISSUER NOT Fund Based- COOPERATING; Rating continues Term Loan to remain under 'Issuer Not Cooperating' category ICRA has been trying to seek information from the entity so as to monitor its performance. Further, ICRA has been sending repeated reminders to the entity for payment of surveillance fee that became due. Despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. The rating action has been taken in accordance with ICRA's policy in respect of non-cooperation by a rated entity available at www.icra.in. Vama Infra (VI) was established in 2013 as a partnership firm based in Surat (Gujarat) and is involved in the construction of a residential project - Veronaa Residency in the Sarthana-Simada area of Surat. The firm is a part of the 'RiseOn Group,' which is engaged actively in real estate development in Surat and Ahmedabad. The partners have almost three decades of experience in real estate development through the RiseOn group. VEER INDUSTRIES: CARE Reaffirms B+ Rating on INR6.0cr LT Loan ------------------------------------------------------------- CARE Ratings reaffirmed ratings on certain bank facilities of Veer Industries (VEI), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank Facilities 6.00 CARE B+; Stable Reaffirmed Short Term Bank Facilities 2.25 CARE A4 Reaffirmed Detailed Rationale & Key Rating Drivers The ratings assigned to the bank facilities of VEI continue to remain constrained by its small and declining scale of operations with low partner's capital base, leveraged capital structure and weak debt coverage indicators. Further, the ratings continue to remain constrained by risk associated with elongated operating cycle, constitution of the entity being a partnership firm, susceptibility to fluctuations in raw material prices and highly competitive nature of the industry. The ratings, however, continue to draw comfort from experienced partners coupled with long track record of operations and moderate profitability margins. Rating Sensitivities Positive Factors - Factors that could lead to positive rating action/upgrade: * Improvement in scale of operations as marked by total operating income of above INR60.00 crore. * Improvement in the capital structure as marked by overall gearing ratio of below 1.20x. Negative Factors- Factors that could lead to negative rating action/downgrade: * Deterioration in profitability margins as marked by PBILDT and PAT margin below 4.00% and 0.50% respectively. * Continued elongation in the operating cycle of the firm beyond 180 days. Detailed description of the key rating drivers Key Rating Weaknesses * Small and declining scale of operations with low partner's capital base: VEI's scale of operations continues to remain small as evident from total operating income (TOI) of INR26.51 crore and gross cash accruals of INR0.63 crore respectively, during FY22 (FY refers to the period April 1 to March 31) as against INR27.80 crore and INR0.54 crore respectively, during FY21. Nevertheless, the scale remains small; it limits the firm's financial flexibility in times of stress and deprives it of scale benefits. VEI's scale of operations decline for the period FY20-FY22 (refers to the period April 1 to March 31). The same was mainly on account of lower intake from its existing customers owing to COVID-19 impact. Further, the partner's capital base also stood small at INR7.90 crore as on March 31, 2022. Furthermore, the firm has achieved total operating income of ~Rs.24.00 crore during 8MFY23 (refers to the period from April 1, 2022 to November 30, 2022; based on provisional results). * Leveraged capital structure and weak debt coverage indicators: The capital structure of the firm stood leveraged as on the past two balance sheet dates ending March 31, '21-'22 mainly on account of high dependence on external borrowings to fund the working capital requirements of business against the partner's capital base. Overall gearing ratio stood at 2.08x as on March 31, 2022 showing moderation from 1.63x as on March 31, 2021 mainly on account of availment of COVID-19 relief loan to fund the incremental working capital requirements to business caused due to uncertainties of COVID-19 impact. Further, on account of high debt levels and low gross cash accruals; the debt coverage indicators as marked by interest coverage and total debt to GCA continue to remain weak at 1.45x and 25.96x respectively, during FY22 as against 1.38x and 25.37x respectively in FY21. * Elongated operating cycle: The operations of the firm continue to remain elongated marked by operating cycle of 158 days for FY22 as against 124 days for FY21 with a majority of funds blocked in inventory and a moderate portion in debtors. Owing to large product portfolio (different type of design, quality, sizes, etc.), the firm is required to maintain adequate inventory of raw material for smooth running of its production processes and to ensure prompt delivery to its customers resulting in an average inventory holding period of around 111 days for FY22. Inventory holding period elongated in FY22 as firm purchased raw material inventory in bulk to avail good discount from suppliers; thus, the inventory level had gone up and led to further elongation of inventory holding period. Being in highly competitive nature of industry, the firm normally offers credit period of around 5-6 months to its customers. Furthermore, there is normally a procedural delay in relation being customers are mainly government undertakings. The firm receives an average credit period of around 4-5 months from its suppliers. The working capital borrowings of the firm remained almost 90% utilized during the past 12 months ending November, 2022. * Constitution of the entity being a partnership firm: VEI's constitution being a partnership firm has the inherent risk of possibility of withdrawal of the partner's capital at the time of personal contingency and firm being dissolved upon the death/retirement/insolvency of partner. Moreover, partnership firms have restricted access to external borrowing as credit worthiness of partners would be the key factors affecting credit decision for the lenders. Hence, limited funding avenues along with limited financial flexibility have resulted in small scale of operations for the firm. * Susceptibility to fluctuations in raw material prices: Raw material constituted around (87%) of the total cost of production for the last 3 years (FY20-FY22), thereby making profitability sensitive to raw material prices mainly due to the reason that the major raw materials are commodity in nature and witness frequent price fluctuations. Thus, any adverse change in the prices of the raw material may affect the profitability margins of the firm. * Highly competitive nature of the industry: VEI operates in highly competitive industry characterized by the presence of large number of players in the unorganized and organized sectors. There are number of small and regional players and catering to the same market which has limited the bargaining power of the firm and has exerted pressure on its margins. Key Rating Strengths * Experienced partners coupled with long track record of operations: VEI is a family run business, Mr. Prateek Jain and Mr. Ajit Prasad Jain are the partners of the firm and they collectively look after the overall operations of the firm. Mr. Ajit Prasad Jain is graduate and holds accumulated vast experience of more than three decades in wires & cables manufacturing business through his association with this entity and in individual capacity. Mr. Prateek Jain is post graduate by qualification and holds experience of more than one decade in this business through his association with this entity. The firm is having a considerable track record in this business which has resulted in long term relationships with both suppliers and customers. * Moderate profitability margins: The profitability margins of the firm stood moderate for the past three financial years (FY20-FY22) wherein the firm reaps benefits of its established image in the regional market. Further, the firm maintains wide variety of product portfolio wherein the margins largely depends upon category and quality of product manufactured. Thus, PBILDT and PAT margin of the firm stood at 7.75% and 1.81%, respectively, in FY22 as against 7.15% and 1.33%, respectively, in FY21. Liquidity: Stretched The liquidity position of the firm remained stretched characterized by tightly matched accruals vis-à-vis repayment obligations. The firm has reported gross cash accruals to the extent of INR0.63 crore during FY22 and is expected to generate envisage GCA of INR0.85 crore in FY23 against repayment obligations of INR1.00 crore in same year. Further, the partners will infuse funds in the form of unsecured loans and capital base as and when required to support the liquidity position of the firm. Furthermore, the average utilization of its working capital limits remained almost 90% utilized for the past 12 month's period ending November, 2022. The firm has low free cash & bank balances which stood at INR0.13 crore and liquid investments of INR0.70 crore as on March 31, 2022. Delhi based, Veer Industries (VEI) was established in the year 1978 as a proprietorship firm by Mr. Ajit Prasad Jain. It reconstituted into partnership firm in the year 2011. The firm is currently being managed by Mr. Prateek Jain and Mr. Ajit Prasad Jain sharing profit and losses equally. VEI is engaged in the manufacturing of cables and wires i.e. submersible winding wire, copper winding wire, enamelled copper wire, motor wing wire, transformer winding wire, three core cable and others, etc. The firm sells its products under the name of 'Aqua' and 'Reliable' through network of dealers and distributor network located across India. ZEE ENTERTAINMENT: IPRS Files Insolvency Petition Against Firm -------------------------------------------------------------- Livemint.com reports that the Indian Performing Right Society (IPRS) has filed a petition at the Mumbai bench of the National Company Law Tribunal (NCLT) under the Corporate Insolvency Resolution Process (CIRP) against Zee Entertainment Enterprises (ZEE), seeking a payment of over INR211.41 crore. Livemint.com relates that the company informed the stock exchanges on Jan. 2 that IPRS, an operational creditor, has moved the dedicated bankruptcy court claiming a debt and default of INR211,41,82,521 towards royalty payable for utilization of "literary and musical works". According to the report, ZEE said the company will be filing its reply rejecting the claim on the grounds that there is a pre-existing dispute between the parties on the claimed amount and that the claim is not in consonance with the interpretation of the law on the point of payment of royalties for "literary and musical works" by the Delhi High Court. "Hence, the claimed amount is not due or payable to IPRS." Last year, IndusInd Bank Ltd approached the dedicated bankruptcy court against ZEE for an alleged default of INR89 crore, Livemint.com recalls. Later, Axis Finance, a subsidiary of private sector lender Axis Bank, moved the Bombay High Court against Essel Group promoter Subhash Chandra and his sons Punit and Amit Goenka, seeking recovery of INR61.64 crore. Last month, another financial creditor, IDBI Bank filed an insolvency application claiming a default of INR149 crore, Livemint.com relates. The bank's purported claim arises under a debt service reserve agreement entered into by the bank and the company for the financial facility availed by Siti Networks, an Essel group entity. ZEE, which has entered into a definitive agreement with Culver Max Entertainment (earlier Sony Pictures Networks India) for a merger, is awaiting NCLT clearance for the same. However, the three lenders - IndusInd Bank, Axis Finance (AFL), and IDBI Bank - have already approached the tribunal to intervene in the proposed merger, the report states. Based in Mumbai, India, Zee Entertainment Enterprises Limited, together with its subsidiaries, engages in broadcasting satellite television channels. ================= I N D O N E S I A ================= INDONESIA: 2022 Unaudited Budget Deficit at 2.38% of GDP -------------------------------------------------------- Reuters reports that Indonesia recorded a IDR464.3 trillion fiscal deficit in 2022, or 2.38% of gross domestic product, based on unaudited data, its finance minister Sri Mulyani Indrawati said on Jan. 3, much smaller than originally designed. According to Reuters, the government had initially targeted a budget deficit of 4.85% of GDP. Revenue collection, however, got a boost from higher commodity prices and the easing of COVID restrictions last year, prompting the government to revise down the deficit forecast several times. The latest figure was below a forecast on Dec. 21, when President Joko Widodo said he expected a 2.49% deficit, Reuters says. Reuters relates that the resource-rich country recorded IDR2,626.4 trillion of revenue last year, up 30.6% from 2021 and about 16% bigger than the target, the minister told an online news conference. The government spent IDR3,090.8 trillion, slightly below the planned amount and representing 11% growth from the previous year. JAPFA COMFEED: S&P Lowers LongTerm ICR to 'B+', Outlook Stable -------------------------------------------------------------- S&P Global Ratings, on Dec. 30, 2022, lowered its long-term issuer credit rating on Japfa Comfeed Indonesia Tbk. PT to 'B+' from 'BB-'. S&P also lowered the long-term issue ratings on the company's senior unsecured notes due March 2026 to 'B+'. The stable outlook on Japfa Comfeed reflect S&P's view that the company and its parent will control capital expenditure (capex), dividends, and debt as costs pressure continues. It also reflects its view that Japfa Ltd. and Japfa Comfeed will proactively manage their working capital needs and debt maturities over the next 12 months. The lowering of the rating on Japfa Comfeed stems from Japfa Ltd.'s weakened creditworthiness following distribution in specie of its entire shareholding in its AustAsia dairy business. The completion of distribution in specie of Japfa Ltd.'s diary business has weakened the group's earnings quality, scale and revenue diversity. S&P now views Japfa Comfeed and Japfa Ltd. as having the same level of creditworthiness. This is essentially because Japfa Comfeed will account for 80%-90% of the parent's consolidated EBITDA and 60%-70% of the consolidated debt. S&P said, "Going forward, we expect that the rating on Japfa Comfeed will be constrained by the creditworthiness of its parent as a result of its strategic importance and operational linkages. We view Japfa Ltd.'s other animal protein (APO) business in Vietnam as well as in India and in Myanmar to be marginally weaker than Japfa Comfeed. These are APO businesses and are suffering from elevated raw material costs and high seasonality in working capital needs. Previously, the dairy business contributed about 30% of Japfa's EBITDA in 2021 and provided a relatively stable source of cash flow to offset the parent group's volatile poultry business. Supporting this was the favorable demand/supply outlook in China." Japfa Ltd. will continue to face operating headwinds in 2023, despite revenue growth. Japfa Comfeed remains exposed to the poultry oversupply in Indonesia. The price of broiler depends on the frequency of the government's ongoing culling program, which aims to rebalance demand and supply. This will add uncertainties to the Indonesia poultry business in 2023, as the culling program to support broiler prices could increase the country's inflation rate. There was no major culling program between May and September. Consequently, broiler prices dropped, and the company's commercial farming business suffered an operating loss in the third quarter of 2022. S&P said, "We expect raw material costs will remain elevated in 2023, given the supply disruptions linked to the Russia-Ukraine conflict and a weaker Indonesian rupiah (IDR) against the U.S. dollar. Global soybean and domestic corn prices have moderated; however, they remain high compared with pre-COVID-19 levels. About 30% of the company's input costs are U.S. dollar-denominated, mostly related to costs of soybean. The rupiah has depreciated by about 9.4% against the U.S. dollar since the start of the year. Corn is mostly sourced domestically, and represents about half of the input costs. "Despite this, we believe Japfa Comfeed's margins will stabilize in 2023. This is because the company has demonstrated its ability to raise feed prices since the start of this year. This helped to improve feed operating margins to 8.4% in the third quarter of 2022, compared with 7.5% of the first quarter. That said, low broiler prices could weaken the ability of farmers to absorb higher feed prices and therefore limit Japfa Comfeed's ability to pass on further cost hikes. "By our estimate, Japfa Comfeed's overall EBITDA margin will remain at 9%-9.5% in 2022 and 2023, after narrowing from 10.5% in 2021 and 11.2% in 2020." Japfa Comfeed's APO business in Vietnam should remain under pressure in the first half of 2023 due to elevated raw material costs and the African Swine Fever outbreak, which has been ongoing since late 2021. S&P expects a gradual recovery in the second half, with the assumption that African swine fever will be contained. Japfa Ltd. will continue to deliver solid revenue growth as a whole in 2023, in S&P's view, stemming from rising prices and expand capacity. This could partly offset loss in margins. S&P estimates the company will grow its revenue by about 10% annually in 2022 and 2023. Japfa Ltd.'s elevated leverage and tighter liquidity are unlikely to improve in the next 12 months. High raw material costs have increased inventory and working capital requirements for the company. S&P said, "We estimate working capital will grow by IDR2 trillion to IDR2.2 trillion in 2022, and further by IDR800 billion to IDR1 trillion in 2023 to support revenue growth. Japfa Comfeed generally funds the working capital growth through a mix of working capital loans and term loans, therefore weakening leverage ratios. The company's debt grew by IDR1.8 trillion until the end of third quarter 2022, compared with the same period in 2021. We estimate the company's funds from operations (FFO)-to-debt ratio will weaken to 22%-25% in 2022 and 2023, against 29% in 2021." Japfa Comfeed's interest coverage ratios are also weakening under the rate-hike cycle. S&P said, "We estimate about 60% of the company's loan are on a floating basis. The one-month Jakarta inter bank offered rate (JIBOR) has increased to 5.95% as of Dec. 20, 2022, from 3.55% at the start of April this year. The impact on the interest coverage is partly reduced by the company's recent refinancing with lower credit spreads. We estimate Japfa Comfeed's FFO cash interest coverage ratio will decrease to 4.7x-5.0x in 2022 and 4.0x-4.3x in 2023, against 5.1x in 2021." Japfa Ltd.'s financial metrics have deteriorated faster than those of Japfa Comfeed because of a weak APO segment. S&P said, "We expect the metrics to recover moderately in 2023. We estimate the company's FFO-to-debt ratio will improve to about 20% in 2023 after falling to 18%-20% in 2022 (excluding the China dairy segment)." The FFO cash interest coverage ratio will likely weaken to 3.7x-4x in 2022 (excluding the China dairy segment) and 3.2x-3.5x in 2023. S&P said, "We assess Japfa Ltd. and Japfa Comfeed's ratio of liquidity sources to liquidity uses in the 12 months ending Sept. 30, 2023, at about 1x, as working capital requirements were partially funded by short-term debt. The company's strong banking relationship and record of actively managing its maturities partly mitigate the liquidity risks. We estimate the company's cash and unutilized committed banking lines could cover its debt due in the next 12 months." Japfa Comfeed will likely remain conservative on its capex until operating conditions improve. S&P said, "We have revised our forecast on the company's annual capex to about IDR2 trillion in 2022 and IDR2.5 trillion in 2023. This is 10% lower than our forecast in April. The reduced spending will mainly fund maintenance capex, which we estimate at about IDR500 billion annually, and capacity expansion in Indonesia such as own commercial farms. We also believe Japfa Comfeed has the flexibility to adjust its expansionary capex according to cash flow and operational recovery." S&P said, "We expect Japfa Ltd. and Japfa Comfeed will fund most of their capex using internally generated operating cash flow over the next two years, reducing the need for additional debt. Japfa Ltd. is also planning to build a swine-breeding pyramid in Vietnam. "The stable outlook on Japfa Comfeed reflects our view that Japfa Ltd. and Japfa Comfeed will control capex, dividends, and debt as cost pressures continue. It also reflects our view that Japfa Ltd. and Japfa Comfeed will proactively manage their working capital needs and debt maturities over the next 12 months." S&P may lower the rating on Japfa Comfeed if Japfa Ltd.'s credit quality deteriorates, which could happen if: -- Japfa Ltd.'s leverage deteriorates from S&P's expectation, which could occur if the company's EBITDA margin contracts more than we expect or its capex and working capital needs are persistently higher than its operating cash flow. The FFO-to-debt ratio falling below 20% or FFO cash interest coverage falling below 3.0x on a sustained basis could indicate such deterioration. -- The liquidity profile of Japfa Ltd. weakens notably such that S&P expects the ratio of sources to uses of liquidity to fall below 1x with no signs of improvement. This could happen if the company increases use of short-term debt while failing to maintain sufficient cash or multi-year committed credit facilities. -- S&P said, "Because we regard Japfa Comfeed as a core subsidiary of Japfa Ltd., rating upside for Japfa Comfeed would require us to raise our credit view on Japfa Ltd. This could happen if we envisage earnings recovery at Japfa Ltd. and believe the group will prudently manage its capex and liquidity." Indications of such improvement are the company's FFO-to-debt rising above 30% sustainably while the FFO-to-cash coverage ratio improves toward 5x. An upgrade would also depend on the group improving its liquidity profile such that ratio of sources to uses of liquidity to sustain above 1.2x. Although it would not change the rating on Japfa Comfeed, S&P may raise its assessment of the company's stand-alone credit profile (SACP) if it can improve its FFO-to-debt above 30% sustainably while the FFO-to-cash coverage ratio improves toward 5x and with the ratio of sources to uses of liquidity sustains above 1.2x. ESG credit indicators: E-3, S-2, G-3 ================= S I N G A P O R E ================= ABHA INVESTMENTS: Creditors' Proofs of Debt Due on Feb. 3 --------------------------------------------------------- Creditors of Abha Investments Pte. Ltd. are required to file their proofs of debt by Feb. 3, 2023, to be included in the company's dividend distribution. The company commenced wind-up proceedings on Dec. 30, 2022. The company's liquidators are: Lum Keng Chee Deepak Kumar Khandelwal AiGO Pte Ltd c/o 49 Strathmore Ave #02-217 Singapore 140049 CHOSEN INVESTMENT: Creditors' Proofs of Debt Due on Feb. 3 ---------------------------------------------------------- Creditors of Chosen Investment Pte Ltd. are required to file their proofs of debt by Feb. 3, 2023, to be included in the company's dividend distribution. The company's liquidators are: Lee Yin Chen Loo Min Min 164 Bukit Merah Central #03-3655 Singapore 150164 ===================== S O U T H K O R E A ===================== ASIANA AIRLINES: Korean Air to Complete Acquisition This Year ------------------------------------------------------------- The Korea Times reports that Cho Won-tae, chairman of Hanjin Group, said the aviation industry will get back on track this year, and asked Korean Air employees to help complete the acquisition of Asiana Airlines in his New Year address. "We've seen a glimpse of normalization and the airports are beginning to bustle with passengers whom we have missed dearly. We also found hope and pleasure in returning to work to see our colleagues," Cho said in his New Year message that was posted on the company's employee website, Jan. 2. "We need to identify in advance our customers' preferred destinations and services, and analyze when and where to add operations as well as which services to enhance." Amidst growing economic uncertainties, Cho assured his colleagues that the airline is confident and ready to move forward, The Korea Times relays. "There have been numerous challenges in our way, but we've always overcome and leveraged them to create new opportunities. We're armed with more than half a century of experience and will use this insight to address our future." The chairman emphasized the importance of successfully acquiring Asiana within the year. "2023 is a pivotal year for completing the huge task of closing our acquisition of Asiana Airlines. We are in the last stage with the remaining overseas competition authorities reviewing the deal," the report quotes Cho as saying. Cho also emphasized Korean Air's environment, social and corporate governance (ESG) duties as a responsible member of society. "ESG management is no longer a choice, but mandatory for our future survival. We've always been committed to the well-being of our society. Introducing eco-friendly aircraft, reducing waste through increased in-cabin recycling and operating an ESG committee to improve governance are all part of our efforts to support our social responsibility. We will not stop here, but continue to make Korean Air a responsible company that fulfills its corporate responsibilities and is beloved by its customers," he said. "While the future demands more wisdom from us than ever, we will continue on our path as we always have. We are the country's top aviation experts and know how to give our customers around the globe the ultimate travel experience." About Asiana Airlines Headquartered in Osoe-Dong Kangseo-Gu, South Korea, Asiana Airlines Incorporated is engaged in air transportation, engineering, construction, facilities, electricity, ground handling, catering, communication, logo products and e-business. Asiana Airlines is a unit of the Kumho Asiana Group, a South Korean conglomerate whose business portfolio includes tire manufacturing and chemical production. State lenders Korea Development Bank and the Export-Import Bank of Korea planned to inject a combined KRW1.7 trillion into Asiana to help the airline stay afloat. In self-help measures, Asiana has had all of its 10,500 employees take unpaid leave for 15 days a month since April 2020 until business circumstances normalize, Yonhap noted. Asiana's executives have also agreed to forgo 60% of their wages, though no specific time frame was given for how long the pay cuts will remain in effect. In November 2020, Korean Air said it will acquire Asiana Airlines in a deal valued at KRW1.8 trillion that could create the world's 10th-biggest airline by fleets, Yonhap said. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter-Asia Pacific is a daily newsletter co- published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez, Julie Anne L. Toledo, Ivy B. Magdadaro and Peter A. Chapman, Editors. Copyright 2023. All rights reserved. ISSN: 1520-9482. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. TCR-AP subscription rate is US$775 for 6 months delivered via e- mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are US$25 each. For subscription information, contact Peter Chapman at 215-945-7000. *** End of Transmission ***